Brewdog, Hawksmoor hit brakes on IPO plans

The Financial Times first reported on Hawksmoor's decision. It cited founder Will Beckett, who said the chain of steak houses has paused talks about refinancing, including via a flotation, as he is concentrating on recovery following the Covid-19 pandemic and is looking to reopen and launch new restaurants.

Beckett added that prospective cornerstone investors had shown strong interest and that trading is better than in 2019, but highlighted the restaurant sector's instability.

The investment bank Berensberg had been advising Hawksmoor on its IPO plans, the item said.

Graphite Capital acquired Hawksmoor in 2013, supporting the group's management buyout. Unquote reported at the time that the deal was valued at between GBP 35m and GBP 40m.

Brewdog, a craft brewing group based in Scotland, is also pausing plans to float on the stock exchange, the Daily Telegraph reported on 18 October.

Founder James Watt was cited as saying the company could now float next year or in 2023 and "concrete steps" are being taken towards the IPO, but that uncertainty in the post-Covid hospitality sector had prompted a delay in the potential GBP 2.1bn IPO planned for this year.

Approximately one quarter of Brewdog's revenues come from its hospitality subsidiary, which operates several hotels and bars, the report noted.

US-based GP TSG Consumer Partners invested GBP 213m in Brewdog in a deal valuing the business at GBP 1bn in 2017.

The deal reportedly saw TSG acquire a 22% stake in the business and was structured as GBP 113m in replacement capital, with the company's co-founders and early-stage investors making a partial exit, and GBP 100m in expansion capital.

Sponsors have capitalised on the IPO window this year. In the first nine months of the year, financial-sponsor-backed IPOs on European exchanges reached USD 25.3bn in deal value across 41 listings, Dealogic data shows. This compares to just eight IPOs in the first nine months of 2020, worth a combined USD 6.3bn.

That said, a number of businesses postponed plans after initially looking to take advantage of apparent investor appetite. Not all listings have fared equally, either. Deliveroo is a case in point, with the company's share price falling by more than 25% on its March market debut on the London Stock Exchange. Its share price steadily recovered between late June and mid-August, but has fallen again since. It currently sits at around 284 pence per share, equating to a -27% drop against the offer price.

The pipeline for confirmed and potential sponsor-backed listings nevertheless remains strong. This includes Sisal, backed by CVC, which was recently reported as having appointed advisers to prep for a 2022 IPO; Inflexion-backed Marley, which announced its intention to float in mid-September; and Carlyle- and GIC-backed Nouryon Chemicals, which filed its prospectus earlier this month, among others.

Click here to access the latest European IPO Pipeline, which offers a list of IPO-related intelligence covered by Mergermarket over the past month

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• Topics
• Exits
• Consumer
• UK / Ireland
• IPO
• United Kingdom
• Graphite Capital
• TSG Consumer Partners